Research On The Reduction Rule Of Liquidated Damages

The concept of liquidated damages reduction was proposed by church jurists as early as the 13 th century.In today's highly free market economy,the parties often prevent problems such as inability or obstacles to performance and entanglement of responsibility before and after the contract,the transaction risk is allocated in advance,and the liquidated debt is agreed to deter the counterparty with money and debt in order to urge the normal performance of the contract.Under the principle of autonomy of civil and commercial law,as the spirit of the autonomy of private law,the liquidated damages system is widely used in the trading around the world.It can be seen that liquidated damages are urging debtors to perform normally at the same time property protection also plays a compensatory role.However,in the course of operation of liquidated damages,in order to ensure the security of the contract,the trader uses empiricalism during the transaction as a prejudgment of the consequences of non-performance of the contract.Therefore,a liquidated damages higher than the normal level is usually set as a deterrent.The pursuit of excessive compensation is not the normal performance of the contract,and liquidated damages will take effect.When the breach occurs,the debtor will need to bear unrealistic default compensation.If the debtor pays the excessively high liquidated damages to the creditor,They are clearly suspected of improper gains at this time.Formal justice at the same time runs counter to substantive justice.Therefore,the adjustment of the fine for liquidated damages plays a very important role.Cases of parties applying for liquidation for liquidated damages have emerged.There are many difficulties in the court's fair and free exercise of discretion in this regard.In view of the urgency of theory and reality,it is urgent to study the rule of liquidated damages.The main body of this article is composed of the following four parts:The first chapter starts with the status quo of liquidated damages operation in China,and mainly discusses the practical issues in the liquidation of liquidated damages and the historical process of liquidated damages legislation.By examining practical cases and judicial status,it is found that there is a high rate in liquidated liquidation reduction,and the judgement standards are different.Then we discuss in detail the basic conditions of China from early liquidated damages laws to Article 114 of the Contract Law to determine the rules for the fine for liquidated damages,and from the reference factors in the judicial interpretation of contract law(2)for the reduction of liquidated damages to other judicial interpretations and guidance opinions for more quantitative details of the reduction,showing the impact of and restrictions on the provisions for liquidated damages by legal provisions and the spirit of the law.The second chapter starts with the basic theory of liquidated damages.By examining the historical context of the liquidated damages reduction system,it is found that the development history of liquidated damages is the history of liquidated damages limitation.In the field of comparative law,find the historical source and theoretical basis for liquidated damages.Under the legal analysis of the liquidated damages reduction,strive to clarify the justification and value basis of liquidated damages reduction.Liquidated damages reduction should be an exception to ensure substantial justice and fairness under the freedom of private law.The legislative spirit and value pursuit of civil and commercial Activities in accordance with the basic principles of civil Law.Finally,by demonstrating the functional attributes of liquidated damages,that is,the performance guarantee function of liquidated damages,it is pointed out that the naturally excessive tendency of liquidated damages needs to be regulated by discretionary rules,and the liquidation of liquidated damages has a solid and just foundation.The third chapter starts from the nature of the penalty for liquidated damages,and mainly discusses the applicable basis of penalty for liquidated damages.The clarity of the nature of the discretion helps to lay the foundation for the application of the rule.It is found that the right to liquidate damages is consistent with the formation of the right of action in terms of the exercise method and functional effect,so it should be within the scope of formation of the right of action.Regardless of judicial practice or legislative arrangements,the metal nature of breach of contract is biased towards the principle of “compensation-based and punitive supplementary”.By understanding the connotation of compensable liquidated damages and punitive liquidated damages,two types are determined.The application of the penalty rules for attributive penalties should be well-founded,including that there should be room for inclusion in the penalty rules for the liquidated damages already paid.In the initiation of liquidated damages reduction,taking into account judicial reduction as a compulsory legal norm for public power to intervene in private rights,the conditions for initiation should be cautious,the parties' application model should be adhered to,and the judge's right to explain the exercise should be based on the principle of moderation and respect for party autonomy.In terms of proof,following Article 8 of the Guiding Opinions on Civil and Commercial Disputes,the breaching party is required to bear the burden of proof of claiming that the breach of contract is too high.Then the judge will guide the two parties to give full evidence,comprehensively weigh the solid evidence and judge whether and how much to fine.The fourth chapter starts with the understanding of Article 29 of the Judicial Interpretation of Contract Law(2).Considering and demonstrating reference factors for liquidation penalty reduction.From a multi-interest measurement perspective,it determines the connotative relationship between "incurred losses" and "actual losses",and the expected benefits to make up for the shortcomings of the actual loss in the discretionary rules.Analyzing the role and significance of contract performance and the parties' faults as reference factors in the discretionary reduction,and clarify that the 30% ratio should play a role of supporting flexibility instead of a one-size-fits-all rigid standard,Finally,by demonstrating the value of fairness principles and good faith principles in the discretionary reduction,it is concluded that the reduction of liquidated damages should be the result of multi-interest measurement with reference to factors...